Leaked NFL Documents: While Owner Cried Hardship, Carolina Panthers Had $112 Million Profit Over Two Years
Posted 07 March 2013 - 09:04 PM
Posted 07 March 2013 - 09:05 PM
$100 Million Profit over 2 years is not that big a Profit Margin, 20 something percent isn't much in the Entertainment industry-Quote from unnamed Exxon Mobile executive.
I agree Jerry Richardson had to really has to make life adjustments this past few years. I wonder if his Butler had to get the groceries with Jerry's EBT card. Times is tough y'all!
Posted 07 March 2013 - 09:16 PM
Congrats to Jerry n he has to reap the rewards of making this money. Its why you own a team and make it happen when he brought the Panthers here with the help of PSL owners.
claiming poverty..well you have to do that in any negotiation.. True or not.
Posted 07 March 2013 - 09:23 PM
Seems like none of the major news outlets care.....for now... which is a good thing.
I'm watching the Office on NBC and they just had a promo for the news at 11 and they were talking about it.
This is going to create a massive shitstorm for JR. It hasn't even scratched the surface.
Posted 07 March 2013 - 09:26 PM
Posted 07 March 2013 - 09:27 PM
So just call it what it is...a shakedown
JR doesn't care about keeping the team here (or the product on the field). He wants $100m and has spun it so well you people are fine with it to the point you are frothing at the mouth
When did JR make any threats?
Charlotte approached the Panthers... JR has just about reached the life expectancy of a heart transplant patient and Charlotte city leaders want to secure the future of the team before a new owner is in place.
Posted 07 March 2013 - 09:40 PM
Posted 07 March 2013 - 09:52 PM
Nothing really...I found the information to be pretty interesting.
So what's so bad about this
JR runs a private business which is profitable and the value is growing every year. No real surprise. I'm sure he is not happy that the doc was made public...
This neither strengthened or weakened my stance on giving him money to put in escalators and a jumbotron
Posted 07 March 2013 - 09:53 PM
The Panther franchise makes money. Since the beginning the owners have been in it to turn a profit. Now we know a number and despite having no basis for understanding this figure and no business knowledge of the professional sports industry we know it must be a bad thing....well....because...we want it to be!
So what's so bad about this
Posted 07 March 2013 - 10:44 PM
I wonder who leaked them.....
Should have used the marty "deal with it" gif.
Posted 08 March 2013 - 12:31 AM
Posted 08 March 2013 - 12:35 AM
Posted 08 March 2013 - 01:01 AM
Anyone around here have the slightest bit of accounting experience? No? Didn't think so.
1.) In 2010 the team heavily cut salary in preparation for the lockout, hence the huge upswing on "operating" profit.
Operating profit != permanent cash in the bank, it is positive cash flow for that season alone. The lockout itself had the potential to wipe out an entire season of games with the way the feelings between ownership and players were going into the lockout, so Richardson had the team shed salary in order to build up a cash balance to fallback on in case games were lost. Obviously, they weren't, but a $78 million operating profit (including revenue sharing) is NOT a yearly profit take for any NFL franchise. Once games resumed and the Panthers started handing out huge contracts to the likes of DeAngelo Williams, that operating profit figure shriveled. What fans tend to forget about signing bonuses, is that while their hit can be spread over up to five years of the contract, they are paid immediately and come directly out of the team's operating cash reserves. The Panthers went into 2010 with $70 million because they didn't pay anyone, but in 2011 they handed out over $50 million in signing bonuses.
2.) One of the biggest reasons Richardson horded cash before the lockout was so, unlike many other NFL owners, he wouldn't have to fire or impose salary cuts on the hundreds of non-player employees in the Panthers organization. Contrast that with the owners who suspended the pay of their entire scouting departments and forced people to look for temporary jobs or new ones entirely.
3.) A payout of $15 million split between Richardson and his collection of minority owners, which is itself an infrequent occurrence (generally NFL teams pay out to their minor investors only once every three years, or even not all in some cases) from a business worth around a billion dollars is laughable in comparison to the compensation prevalent in other businesses of comparable size. You're basically talking about splitting a mid-tier free agent's signing bonus amongst twelve to fifteen people.
4.) This is classic case of cherry-picking numbers to fit a narrative. Revenue numbers have been widely available for one of the league's premiere teams in the Green Bay Packers because they are publicly owned and any reasonable review of their numbers over the last half-decade shows, that while owners are not poverty-stricken by any stretch, they also do not have operating margins that a typical business the size of the NFL would usually have. Where people get on their high horses about the money that teams make is that they find it offensive that teams rake in healthy profits from a business structure that they assume is invulnerable to losing money, which is simply not true: there is no guarantee that the league will continue to be wildly profitable and successful, and there loom some very dangerous dark clouds like the former player lawsuits on the horizon.
5.) Where Deadspin really shows their ass is in regards to Richardson's asking for funds from the city of Charlotte for stadium renovations. First off, the stadium itself was built with barely any public money (the city contributed free land and some infrastructure guarantees) and the figure being requested now is a mere drop in the bucket compared to the figures commanded by other franchises in the NFL. Could the Panthers afford to swing the $140 million themselves? Maybe, but it would require either the majority of their operating income and hampering their future operating cash flow, or taking out a loan. Contrary to what people think, loans for sports franchises are not considered low-risk in the financial realm, which is why the NFL's low-interest loan system even exists. The other aspect to the request for funds is that it gives Richardson a legal mechanism to tie the Panthers to Charlotte for the life of the taxpayer's funding in the likely case he dies soon and the team is sold to a new owner (Richardson seems to have given up on passing the team to his sons, who feuded in their earlier tenures with the franchise.) He wants the team to stay in Carolina, and getting the city and state to kickback a hundred million compared to their estimated $800 million in tax revenue the team has generated in its tenure is not anywhere near as dastardly as the con job pulled on the Minnesota taxpayers over the Vikings potential move to LA.
6.) The lockout wasn't about teams running into the red. They absolutely played poverty-stricken and milked the sob story, but it wasn't about losing money. It was about the fact that the NFL is about to reach it's saturation point in the U.S. market and teams are no longer guaranteed ever-increasing revenues at the rates they had been achieving them through the 90s and 2000s. The CBA as written before depended on ever-climbing salary caps, and the league was about to hit a period where there weren't going to be any for a while. So, the owners and the players bitched about it all for a while, and that was that. The owners came out on the sweet end of the deal, if only because the slow return from the recession will make the austerity level revenue numbers they were turning during the lockout evolve into extremely healthy profits. However, the new salary cap floor will likely stunt profit growths as well.
If anyone actually gave a good goddamn about what the fug these numbers meant it wouldn't be a story, but it's Deadspin so, whatever.